And when should you start thinking about your pension?
With people prioritizing their savings for a New home, Holidays, a new car or paying off debts, pensions can often take a back seat. But when should you really start saving towards your pension? And how much do you need to put aside?
We asked twitter how many times their salary they think they’d need to put into their pension.
<blockquote class="twitter-tweet" data-lang="en"><p lang="en" dir="ltr">It's <a href="https://twitter.com/hashtag/TalkMoneyWeek?src=hash&ref_src=twsrc%5Etfw">#TalkMoneyWeek</a> and because we have integrated with <a href="https://twitter.com/pensionbee?ref_src=twsrc%5Etfw">@pensionbee</a> we wanted to ask you a <a href="https://twitter.com/hashtag/pension?src=hash&ref_src=twsrc%5Etfw">#pension</a> question. 💸🐝 <a href="https://twitter.com/FinCapStrategy?ref_src=twsrc%5Etfw">@FinCapStrategy</a> <br><br>In the UK, how much 'X' your income do you think you will need for a happy <a href="https://twitter.com/hashtag/retirement?src=hash&ref_src=twsrc%5Etfw">#retirement</a>?</p>— Money Dashboard (@moneydashboard) <a href="https://twitter.com/moneydashboard/status/1063086995126317057?ref_src=twsrc%5Etfw">November 15, 2018</a></blockquote>
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The majority of people thought they would need 10X their salary put away to have a happy retirement.
The good news is, that research by Fidelity pensions suggested that for savers in the UK, they would need to set aside 7X their salary to have a “happy” pension. Though who defines what “happy” is?!
Generally, experts say that for a retirement ensuring you don't have to change your lifestyle, the guidelines for workers in the U.K. are to save a total 13 percent of their annual salary each year and aim to have saved 7X their salary by retirement. This will put them on track to replace 35 percent of their pre-retirement income, which Fidelity estimates, when combined with a government pension, may enable them to maintain a pre-retirement lifestyle throughout retirement. Fidelity’s guidelines for U.K. workers are based on a 5 percent sustainable withdrawal rate in retirement.